76-276. Mortgages; mortgagor retains legal title, when; security interest in rents; effect.
In the absence of stipulations to the contrary, the mortgagor of real estate retains the legal title and right of possession thereof. This section shall not limit or otherwise affect the creation, provision, assignment, granting, or enforcement of a security interest in rents arising from real estate pursuant to sections 52-1701 to 52-1708.
Source
Annotations
1. Nature of interest conveyed
2. Rights of mortgagor
3. Rights of mortgagee
4. Assignment of rents
5. Miscellaneous
1. Nature of interest conveyed
A mortgage is a special interest in real property consisting of a security interest for the debts or obligation, and absent stipulation to the contrary, title and right to possession remain in the mortgagor. Dupuy v. Western State Bank, 221 Neb. 230, 375 N.W.2d 909 (1985).
Mortgage conveys no estate, but merely creates lien. Morrill v. Skinner, 57 Neb. 164, 77 N.W. 375 (1898); Orr v. Broad, 52 Neb. 490, 72 N.W. 850 (1897); Higginbottom v. Benson, 24 Neb. 461, 39 N.W. 418 (1888).
Mortgage is mere security in form of conditional conveyance. Barber v. Crowell, 55 Neb. 571, 75 N.W. 1109 (1898).
2. Rights of mortgagor
A mortgagee's status is that of a lienholder. Under this theory, the mortgagee is regarded as owning a security interest in real estate only and the mortgagor retains both the legal title and right of possession. 24th & Dodge Ltd. Part. v. Acceptance Ins. Co., 269 Neb. 31, 690 N.W.2d 769 (2005).
Although title and possession remain in the mortgagor, mortgagees may create a security interest in rents arising from real estate. 24th & Dodge Ltd. Part. v. Acceptance Ins. Co., 269 Neb. 31, 690 N.W.2d 769 (2005).
Mortgagor is deprived of right only by decree of foreclosure. Union Mutual Life Ins. Co. v. Lovitt, 10 Neb. 301, 4 N.W. 986 (1880).
Mortgagor can convey his title by will. Renard v. Brown, 7 Neb. 449 (1878).
3. Rights of mortgagee
Mortgagor is entitled to rents and profits of mortgaged premises until condition broken, but after default, mortgagee has equitable lien thereon which may be enforced by proper proceedings. Federal Farm Mortgage Corporation v. Ganswer, 146 Neb. 635, 20 N.W.2d 689 (1945).
Right of mortgagee to possession may be stipulated in mortgage. Pettit v. Louis, 88 Neb. 496, 129 N.W. 1005 (1911).
Mortgagee cannot demand more than is legally due. First Nat. Bank of David City v. Sargeant, 65 Neb. 594, 91 N.W. 595 (1902).
Stipulation for possession by mortgagee on default in payment is valid. Felino v. Newcomb Lumber Co., 64 Neb. 335, 89 N.W. 755 (1902).
Mortgagee cannot maintain replevin for fixtures removed from premises. Moore v. Moran, 64 Neb. 84, 89 N.W. 629 (1902).
Mortgagee in possession is entitled to collect rents and profits. Huston v. Canfield, 57 Neb. 345, 77 N.W. 763 (1899).
Mortgagee has insurable interest. Hanover Fire Ins. Co. v. Bohn, 48 Neb. 743, 67 N.W. 774 (1896).
4. Assignment of rents
Assignment of possession and rents made by mortgagor by separate instrument is enforceable. Hanks v. Northwestern State Bank of Hay Springs, 143 Neb. 204, 9 N.W.2d 175 (1943).
An assignment of possession and rents by mortgagor to mortgagee, effective upon default and given as consideration for an extension of a mortgage then in default, is not against public policy and is valid and enforceable. Pennsylvania Mut. Life Ins. Co. v. Katz, 139 Neb. 501, 297 N.W. 899 (1941).
5. Miscellaneous
Section applied to quitclaim deed which is in effect a mortgage. Helming v. Forrester, 92 Neb. 284, 138 N.W. 190 (1912).
This section does not prohibit a conveyance of legal title and right of possession to mortgagee, but states presumption in absence of express stipulation. Kirkendall v. Weatherley, 77 Neb. 421, 109 N.W. 757 (1906).
Equitable estate may be mortgaged. Arlington Mill & Elev. Co. v. Yates, 57 Neb. 286, 77 N.W. 677 (1898).
Strict foreclosure will not lie when mortgagor holds legal title. South Omaha Sav. Bank v. Levy, 1 Neb. Unof. 255, 95 N.W. 603 (1901).